National Divestment Auction
The National Divestment Auction was a massive auction that took place in Kalistan in December 2381. Prompted by the Rights and Freedom Party's Dual System Act, the Kalistani government returned a majority of the assets it had confiscated after the Communism Wow! Party's Dramatic Nationalization Act of 2374 to private ownership. The auction took place in three parts: the Agribusiness auction, which sold off the assets of the Ministry of Food and Agriculture, the Financial auction, which auctioned off the businesses controled by the Ministry of Finance, and the General Divestment auction, which auctioned off the companies supervised by the Ministry of Trade and Industry and other ministries. The auction was remarkable because it resulted in the privatization of a majority of Kalistan's economy in a single day. The auction resulted in most of Kalistan's economy reverting to private ownership, equal to about 75% of that which was privately controled before 2374. According to the Dual System Act, the government was to continue operating a nationalized company in every sector, but privatize as much as possible, to create two parallel systems: one nationalized and one privatized. The auction was also meant to help diversify ownership of businesses when compared to the pre-nationalization period, when a majority of businesses were owned by three massive conglomerates. To accomplish this, the parcels that were sold at auction were designed to each consist of one industry in one geographic region. To give an example of how these parameters were put into place, the rail industry on Ananto was divided thus: The Ministry of Transport and Infrastructure maintained control of the Port Davon/Kaliburg and Luxon subway systems, any tollboothes, and the rights to operate passenger trains on a number of rights of way throughout the state. The remaining rail lines were auctioned off in three parcels: one focusing on the West Coast south of Kaliburg, one north of Kaliburg, and one on the East Coast. The auction was for deeds to all the properties, contracts, and assets of the various divisions, sold on the condition that the buyer would immediately charter a company to run the industries continue with production and employment. The price bid at the auction was only 10% paid to the government, the rest represented an investment in the corporation that would be founded to manage the assetts won. In order to afford the high prices of buying a parcel, many individuals joined together into partnerships shortly before the auction, and would create diverse portfolios. In doing so, many mini-conglomerates were created, but this also resulted in the Kalistani economy reverting to a normal, stable state in a short amount of time. 2391 Divestment In 2391 the ten year old Dual System was abolished in favor of an entirely-privatized economy. This move was proposed by the Party of Liberty and Prosperity alone, with no other parties supporting the bill. The resulting auction included not only nationalized companies in manufacturing and agriculture, but the privatization of media and infrastructure that had been nationalized for centuries. The result is that the Kalistani economy is now entirely privated, ten years after it had been entirely nationalized. Category:Economics and Finance